Markets News Report
February 26, 2024

Blast Ecosystem Suffers Rug Pull as RiskOnBlast Drains $1.3M in ETH from Investors

In Brief

Blast Ecosystem suffered its first Rug Pull as scam account RiskOnBlast drained 420 ETH from investors in a seed round and disappeared.

Blast Ecosystem Witnesses First Rug Pull as RiskOnBlast Siphons $1.3M from Investors

Ethereum (ETH) Layer 2 scaling solution Blast’s ecosystem witnessed its first rug pull event. An anonymous account RiskOnBlast, claiming to be a platform for gambling and exchange, raised 420 ETH (equivalent to $1.3 million) from investors in a recent seed round and abruptly disappeared afterwards. Additionally, it participated in Blast’s Big Bang competition, where winning could potentially lead to further funding for the platform.

On Sunday, all social media accounts associated with the project were scrapped. The funds seemingly stolen were sourced from more than 750 wallets. Notably, about $500,000 was transferred to the swapping service ChangeNow, $360,000 to the cryptocurrency exchange MEXC, and $187,000 to another cryptocurrency exchange, Bybit, as reported by Onchain researcher Somaxbt.

RiskOnBlast Ruggs $1.3M from Investors

Blast had previously shared information about the project on its official X account, expressing optimism about its undeniable potential. While Blast itself doesn’t dictate the actions of projects on its blockchain, the social endorsement could be interpreted by investors as an indication of legitimacy.

One investor reported a loss exceeding $12,500, prompting market observers to criticize the absence of due diligence and the risky capital investments in projects that seemingly emerge overnight. Such euphoria around the project characterized a sign of the bull market for some investors, where valuations can often become exuberant, and funds are freely invested without a thorough assessment.

According to PeckShield monitoring, most of the stolen funds from Rug’s Blast ecological game Risk have been transferred to the exchanges ChangeNow, Bybit, MEXC and SideShift, and a small part of the stolen funds have been cross-chained to Arbitrum and Cosmos.

Blast Charts Course for Growth

Blast is an Ethereum Layer 2 scaling solution that offers native yield opportunities for both ETH and stablecoins, which is generated through ETH staking and Real World Asset (RWA) protocols. Originating from the creators of the non-fungible token (NFT) marketplace BLUR, Blast garnered backing from Paradigm and Standard Crypto, raising a $20 million investment shortly after its introduction last year. The official Blast mainnet launch is anticipated for February 2024, with points redemption slated for May 2024.

Recently, Blast has selected 47 projects as winners in its developer competition, chosen from a pool of 3,000 applications. These winning teams are set to receive undisclosed funding in the upcoming months aimed at supporting the development of an ecosystem on the emerging blockchain.

Amid the swift expansion and progress of the Blast ecosystem, recent challenges emphasize the importance of vigilance as the project continues to innovate and advance.

Disclaimer

In line with the Trust Project guidelines, please note that the information provided on this page is not intended to be and should not be interpreted as legal, tax, investment, financial, or any other form of advice. It is important to only invest what you can afford to lose and to seek independent financial advice if you have any doubts. For further information, we suggest referring to the terms and conditions as well as the help and support pages provided by the issuer or advertiser. MetaversePost is committed to accurate, unbiased reporting, but market conditions are subject to change without notice.

About The Author

Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.

More articles
Alisa Davidson
Alisa Davidson

Alisa, a dedicated journalist at the MPost, specializes in cryptocurrency, zero-knowledge proofs, investments, and the expansive realm of Web3. With a keen eye for emerging trends and technologies, she delivers comprehensive coverage to inform and engage readers in the ever-evolving landscape of digital finance.

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